Subject: File No. S7-25-97 Author: "Paul J. Growald" at Internet Date: 11/25/97 2:28 PM November 25, 1997 Mr. Jonathan G. Katz Secretary Securities and Exchange Commission 450 Fifth Street, N.W. Washington, D.C. 20549 Re: File No. S7-25-97 Dear Mr. Katz: As an investor who values strong financial returns as well as corporate responsiveness, I felt impelled to write regarding the amendment to the Securities and Exchange Commission's Rule 14a-8 on shareholder proposals under File No. S7-25-97. If the revisions to the Rule are adopted, the effectiveness at protecting the rights and the votes of corporate shareholders would be diminished. This rule has been a critical tool in raising corporate policy issues of broad public concern in holding corporate managers accountable to shareholders and the larger society. The SEC's role in overseeing this process has been crucial to the success of the corporate governance system. The Commission's low-cost, efficient oversight of proxy voting in public companies has prevented corporate managers from using the resources at their disposal to frustrate shareholder rights through expensive, time-consuming litigation. I am particularly concerned about raising the vote percentage necessary to resubmit a proposal and changing the "relevance" test to an economic test. One would have excluded shareholder efforts that have addressed both corporate governance questions and significant social issues and the other would potentially exclude issues where the potential liability or the social issue at stake is much greater than the sales impact of the issue. Thank you for your attention to this important matter. Sincerely, Paul Growald